Tanger, a prominent shopping center operator, is set to expand its retail offerings by adding five Sephora stores to its centers this year. Each new Sephora location will average around 5,000 square feet, according to a company press release.
The new Sephora stores will be located in Tanger centers in Charleston, South Carolina; Deer Park, New York; National Harbor, Maryland; Palm Beach, Florida; and the Phoenix area. These new additions will join the existing Sephora at Bridge Street Town Centre, a premium open-air center in Huntsville, Alabama, which Tanger acquired in late 2023.
Tanger’s Evolution and Expansion
Tanger is well-known for its outlet centers, boasting a portfolio of 38 outlet centers and an open-air lifestyle center spread across 20 U.S. states and Canada. However, the company has been evolving to meet consumer demands and diversify its offerings. In November, Tanger rebranded from “Tanger Factory Outlet Centers” to simply “Tanger,” reflecting its broader vision.
“Tanger is always listening and responding to what our shoppers want and continually evolving what an outlet center experience can be. Over the last several years, we have significantly diversified our portfolio to include elevated food and beverage options, entertainment, direct-to-consumer brands, and full-priced retailers,” said Tanger CEO Stephen Yalof in an email statement.
The Strategic Addition of Sephora
The inclusion of Sephora, the world’s largest prestige beauty retailer, aligns with Tanger’s strategy to enhance its tenant mix and attract a more aspirational customer base. “As the largest prestige beauty retailer in the world, it will attract an aspirational customer that is looking for the brands they love,” Yalof stated.
Financial Outlook and Market Response
In April, Bank of America Global Research analysts, led by Jeffrey Spector, praised Tanger’s strategic moves. They highlighted the company’s ability to capitalize on external growth opportunities, land densification efforts, and successful asset improvements, along with maintaining a strong balance sheet with minimal refinancing risk. The analysts also endorsed Tanger’s initiative to upgrade its tenant mix but cautioned that this strategy would require time and capital to fully realize its potential.
Future Prospects
Tanger’s ongoing evolution and the integration of high-profile retailers like Sephora illustrate the company’s commitment to transforming the shopping center experience. By diversifying its retail portfolio and responding to consumer preferences, Tanger aims to maintain its competitive edge in the ever-changing retail landscape.